As a busy business owner I value and trust the personal service delivered by Woodruff Financial Planning. They are on hand whenever I need them to discuss the best options for me and my business. They manage my investment portfolio professionally and comprehensively, delivering regular updates and meetings to discuss investment strategy and progress. My investments have consistently risen in value registering an average increase of over 8% per year in the last 4 years despite the difficult trading conditions. I have no hesitation in recommending Woodruff Financial Planning to other would be clients.

First class serviceLiz and Alan Lazell

55

We contacted Woodruff Financial Planning initially with no clearly developed view of our investment priorities. The service we have received has been first class in every respect; Woodruff Financial Planning has explained our options clearly at every stage of the process, always offering professional yet impartial advice and guidance. We have every confidence in the quality and integrity of service provided by Woodruff Financial Planning, and would recommend them without reservation.

Financial planning helped me retireStephen McClure

55

Retirement is most agreeable – it’s so nice to be doing things that I find rewarding, and I find that at the moment I have no regrets and that Monday morning is met with a smile rather than a sigh!

Personal service with Investment ManagementMartin White

55

Woodruff Financial Planning communicates with me frequently. They have helped me to build investment decisions in logical steps. I am happy to recommend Woodruff Financial Planning, and especially the Investment Management and financial service you offer, to anybody who is deciding if this is a good idea or not. In such circumstances, where something changes quickly, this assurance and personal service comes into its own.

Thoroughly recommendedRobbie Stepney

55

When you’re looking to secure your family’s future in case the worst should happen its important to work with a Financial Advisor in who you have a high level of both confidence and trust. I approached Woodruff Financial Planning to help me with some life and critical illness cover. Their detailed knowledge of the subject was clearly evident from our first meeting and they dealt with my subsequent applications from start to finish in a thorough, efficient and effective way. They combine professionalism with an approachable style, they’re straightforward and easy to talk with. Thoroughly recommended.

Completely trustworthySusan Pattrick

55

I asked Woodruff Financial Planning to help my sister with her financial situation. They helped her to place money according to her individual requirement for her personal risk level and she is very happy with the service that she receives from them. I would certainly recommend them as people who are clearly independent and who provide the right kind of advice according to your own personal circumstances. There are no ulterior motives with them. Their service is open and easy to understand. Definitely worth considering as personal financial advisers as well as business financial advisers. They know their stuff and are completely trustworthy!

Pro-active adviceRachel Skells

55

We receive good pro-active advice for our current and future needs.

Easy to understand investment adviceRay Stannard

55

You always give me a quick response. You are able to discuss my options at a level suitable to my own understanding. You offer comprehensive research.

Satisfied with my pension portfolioJanice Bell

55

I am more than satisfied with the service I get for my pension portfolio and that it is regularly reviewed.

Highly professional and ethicalSteve Wilkes

55

Woodruff Financial Planning has a vision of how financial services should be provided. They are highly professional and ethical, I am delighted to recommend their services as IFAs but also as people you should be connected to.

Insight into wealth managementLewis Melia

55

Woodruff Financial Planning has a great insight into wealth management and the creation of long term sustainable income. Their detailed process of how to get to where you want to be, if followed, can deliver real results. Their approach and explanation is clear, and their enthusiasm to get you there is infectious. I would recommend a session with the firm and sign up for their email newsletter. If you need financial and wealth planning then Woodruff Financial Planning is for you.

Professional and thoroughDamian Culhane

55

When planning my financial commitments and requirements I wanted to discuss my needs with someone I knew I could trust. Woodruff Financial Planning was able to explain the various options and I found their advice and insight professional and thorough. I was able to trust Woodruff Financial Planning’s advice and have no hesitation in recommending their services to anyone. Woodruff Financial Planning’s knowledge in the financial services sector has helped me to cut through the nitty gritty and determine the best solution available. Dan Woodruff is a very likable chap and you can trust him implicitly.

Refreshing approach to financial advicePaul Howes

55

Woodruff Financial Planning is not commission driven and therefore I am confident I’m getting the right advice for my money. They always meet deadlines and are very friendly. I have total confidence in Woodruff Financial Planning and I’m glad they are at hand whenever I need advice. Woodruff Financial Planning’s approach to financial planning is very refreshing and they have a great way of explaining things so I understand what I’m buying.

Refreshing approach to financial adviceAlex Barton

55

Many financial advisers are commission hungry salesmen that do not act in your best interests. Believe me I have experienced this on many occasions in the past. But that has all changed for me. Woodruff Financial Planning is fee based which in simple terms means that they work for you and not the financial suppliers. My wife and I have received a personal and reassuring service that has enabled us to get on with the rest of our lives knowing that our finances are in safe hands. How do I know this? Woodruff Financial Planning provides you expert and professional advice supported by reports and key information which enables you to make informed decisions and empowers you to make the correct choices for your needs. If you require professional financial advice for Mortgages to Inheritance Tax there is no need to look any further. A pleasure to do business with!

Spot on mortgage adviceSadie Rizzo

55

The mortgage advice I received was spot on. A variety of mortgage options were clearly explained to me after a full consideration of my needs. I cannot recommend Woodruff Financial Planning enough. I will certainly be returning for mortgage advice in the future.

Competent and professionalRavi Peal-Shankar

55

I have known Woodruff Financial Planning for a while and they are consummate professionals. If you’ve ever felt overwhelmed by the process of financial planning: if you’ve wondered how to find a financial professional who is both competent and trustworthy: whether you’re already well-to-do or just beginning to build a nest egg: – I would highly recommend you talk to Woodruff Financial Planning first!

Helpful and positive investment adviceAngela Low

55

All queries, however small, are dealt with in a helpful and positive manner. If unavailable, calls always returned promptly. E-mail newsletter very informative.

Honest and trustworthy financial adviceRose Barton

55

Woodruff Financial Planning communicates well and explains complicated matters easily to the average person. Your honest and trustworthy manner gives us confidence that we are speaking to the right people about our financial goals.

Overall ExcellenceA Google User

55

I asked Dan about two years ago to help my sister with her financial situation. He helped her to place money according to her individual requirement for her personal risk level and she is very happy with the service that she receives from him. I would certainly recommend Dan as someone who is clearly independent and who provides the right kind of advice according to your own personal circumstances. There are no ulterior motives with Dan. His service is open and easy to understand. Definitely worth considering as a personal financial adviser as well as a business financial adviser. He knows his stuff and is completely trustworthy!

Overall ExcellenceA Google User

55

Woodruff Financial Planning is an Independent Financial Adviser firm in Colchester. They offer a very comprehensive range of services from Mortgages, Protection, Pensions, Investments... They have access to a wide variety of research tools so they can shop around the market to find the best deal. They can explain technical, complicated concepts very simply and clearly allowing you to understand the process and your decisions fully. Highly recommended!

We often see cautious clients who hold fixed rate bonds with their banks. These are popular products with cautious investors since they allow you to benefit from a better rate of interest than you would otherwise get from your bank accounts, while still keeping the money safe.

This article aims to explain how these products work, and also to raise some issues you should consider before you buy into one.

Key points:

How fixed rate bonds work

Advantages and disadvantages of fixed rate bonds

How do fixed rate bonds work?

Fixed rate bonds are issued by your bank. They work like a bank account except that you will lock your money away for a period of time, from a few months to up to 5 years. In return, the bank will pay you a better rate of interest than they usually do in their standard savings accounts. At the end of the period of investment the bank will return the money invested plus interest. This interest is taxable.

They are popular products at the moment since interest rates are low, meaning savers are seeing their incomes reduced. Cautious savers often see these products as a way to increase their rate of return.

How much better is the interest payable?

At the time of writing, the best 1-year fixed rate bonds pay out interest of around 3%. By comparison, the best instant access account will pay you around 2.3%. Both of these interest rates are taxable. Is gaining an extra 0.7% interest (taxable) worth the downside of not having access to your money during that time?

Advantages of fixed rate bonds

They pay a better rate of interest than normal bank accounts

Interest is usually fixed

The products are simple

Your money is protected through the Financial Services Compensation scheme with UK registered banks up to £85,000 per person per institution

Disadvantages

Rates
While the rates of interest are usually better than standard bank accounts, they are not usually that much better. In the example above, if we assume you pay tax on your savings, if you had £50,000 invested in a bank account you might get £920 interest after tax per year; for the fixed rate bond quoted you might get £1,200 interest.

Inflation
At the time of writing the retail prices index for the UK stands at 3.2% (October 2012 figures). Therefore if you pay tax on your savings, even with the best rates available to you, you still might be losing money versus the cost of living.

No access
This can be a major problem. Banks usually refuse access to fixed rate bonds during the investment period, although some do allow you to take withdrawals at a penalty. A client recently had to take out a loan to buy a property since he could not access his money invested in fixed rate bonds as his bank refused him access to this money. This is a real problem, and you should consider whether you will need access to the money before you invest in such a product. Fixed rate bonds are not suitable for your emergency fund.

Rising interest rates
In a time when interest rates are rising, your fixed rate bond would not increase the interest paid. Therefore, your money might be losing value.

Related Articles

This entry was posted
on Monday, November 12th, 2012 at 9:08 am and is filed under Investment Management.
You can follow any responses to this entry through the RSS 2.0 feed.
Responses are currently closed, but you can trackback from your own site.

Unit 5, Park Lane Business Centre, Park Lane, Langham, Colchester, Essex, CO4 5WR Phone: 01206 919101
Principal: D Woodruff. Woodruff Financial Planning is Authorised and
Regulated by the Financial Conduct Authority. By viewing this site, you
are deemed to accept our site conditions
of use in full. This site is for information only, and does not constitute
financial advice. This site is aimed at United Kingdom residents only.